Oil falls below $118 about global economy

Oil prices fell again yesterday, slipping below $118 (Dh433.4) a barrel after steep losses a day earlier were triggered by a round of poor employment and manufacturing data either side of the Atlantic, reviving fears about the global economy. A build in US crude oil stocks also contributed to a slide in prices the previous day, after inventories were reported at the highest level since September 1990. "Everything is dependent on macroeconomic issues. Personally I am, one way or another, even with the fundamental difficulty in identifying all the geopolitical issues like Iran," said Tony Machacek, an oil futures broker at Jefferies Bache. "If these remain on the side, I think prices could easily be heading lower." Brent crude was down 31 cents to $117.89 a barrel at 11.44am, after falling more than one per cent in the prior session. The contract is well below the year's high of $128.40 reached on March 1. US oil was down 24 cents at $104.98 a barrel, after dropping nearly one per cent on Wednesday. A steeper fall in Brent narrowed its premium versus US oil to as low as $12.65 yesterday, the smallest since February 1. US weekly jobless claims data yesterday showed the number of planned lay-offs at US firms rose from March to April.